SEBI Announces Auction of 23 Properties in February 2025 to Recover Investor Funds
The Securities and Exchange Board of India (SEBI) has announced an auction of 23 properties owned by nine companies, including Tower Infotech and Vibgyor Group of Companies, to recover funds illicitly collected from investors. The auction is scheduled for February 6, 2025, and will be conducted online from 11 a.m. to 1 p.m. Other companies whose properties are part of the auction include GBC Industrial Corporation, Waris Group, Pincon Group, Kolkata Weir Industries Ltd (KWIL), Annex Infrastructure India, I-Core Group, and MPS Group. The auction is being organized following directions from the Calcutta High Court and aims to liquidate these assets to compensate affected investors.
The properties involved in the auction include plots, apartments, and buildings located in West Bengal, with a total reserve price set at ₹55 crore. Justice Sailendra Prasad Talukdar has been appointed as the sole member of the committee overseeing the liquidation process. SEBI has engaged Adroit Technical Services, a firm specializing in asset liquidation, to assist with the technical aspects of the auction. This initiative is a part of SEBI's broader effort to recover funds from companies that violated regulatory norms and defrauded investors.
Among the properties to be auctioned, seven belong to Tower Infotech, and another seven are owned by the Vibgyor Group. Two properties each are linked to the Waris Group and GBC Industrial Corporation, while the remaining properties belong to MPS Group, I-Core Group, Annex Infrastructure India, KWIL, and Pincon Group. SEBI has invited bids from interested parties and emphasized the need for bidders to independently verify details regarding encumbrances, litigation status, and property titles before participating. This precaution ensures transparency and reduces risks for prospective buyers.
The auction is a result of SEBI's efforts to address violations by companies that raised funds from investors without complying with regulatory requirements. These companies used financial instruments such as non-convertible debentures (NCDs) and optionally fully convertible debentures (OFCDs) to collect capital, circumventing SEBI's guidelines. For instance, Vibgyor Allied Infrastructure raised ₹61.76 crore in 2009 by issuing OFCDs, while Tower Infotech raised nearly ₹46 crore between 2005 and 2010 through the issuance of NCDs and redeemable preference shares. These actions were carried out without the required approvals, resulting in significant financial losses for investors.
The auction represents a significant step toward repaying investors defrauded by these companies. Under the High Court's directive, Justice Talukdar’s committee has been tasked with overseeing the liquidation of the assets and ensuring that the recovered funds are used to compensate affected individuals. SEBI’s notice underscores the importance of due diligence, urging bidders to verify all claims and legal disputes related to the properties before submitting their bids.
This development highlights SEBI's commitment to protecting investor interests and enforcing accountability in India’s financial markets. By liquidating these properties, SEBI aims to recover funds and provide relief to investors who fell victim to fraudulent schemes. The auction serves as a reminder of the regulator's determination to uphold market integrity and address violations through decisive action.
